News

Sandwell Council undertakes first ever eAuction

03. 02. 2014 15:15 Jan Šlachta

...and saves over £3.9m!

On 15th October Sandwell Council undertook their first ever e-Auction which was for the provision of Home to School Transport. It consisted of 34 Home to School Transport Routes split into 2 e-Auction sessions of 17 Routes each.

The e-Auction was financially supported by IEWM as part of the ongoing e-Auction programme available to West Midlands Authorities.

In what proved to be a highly competitive e-Auction exercise amongst prospective providers the overall outcome was a saving (monetary) in excess of £3.9M for the Authority. This saving was calculated against the best tendered rates over a four year contract period.

e-Auctions are also referred to as reverse auctions in which suppliers offer progressively lower bids in order to win a contract; these have been used by procurement specialists since 1995. e-Auctions are different from conventional tendering processes as they are conducted online and allow bidders to see the most competitive bid, and to re-bid in response. Bidders are all pre-qualified and quality scores are typically built into the auction process as bid weightings. Bidding may last a few minutes, or many hours.

Over the years IEWM have assisted with the delivery of e-Auctions within the region that have to date achieved savings in excess of £80M. Areas of procurement via e-Auctions have so far ranged from transport, office commodities to musical instruments!

IEWM will continue to work with and support Local Authorities in the region for the delivery of e-Auctions. Under this programme costs for the delivery of e-Auctions will be covered (in full) by IEWM and any subsequent savings gleaned will be 100% retained by the participating Local Authority.

IEWM will work with both the Local Authorities and the e-Auction solution providers to develop a Business Case in order to highlight savings achieved and any best practices picked up via the e-Auction. The Business Cases will then be shared with the other Local Authorities within the region in order to assist them with any future procurement activities and decisions.